Tesla (TSLA) is not done cutting vehicle prices in 2023 after the global EV giant chopped U.S. Model 3 and Model Y prices Thursday night, the latest salvo in the auto price war that has engulfed the industry this year. TSLA shares fell early before edging up in afternoon trade Friday.
X
Tesla reduced the base Model 3 RWD price by $1,250 to $38,990 while dropping the Model 3 Long Range by $1,250 to $45,990. The Elon Musk outfit also whittled down its Model 3 Performance price by $2,250 to $53,240.
Meanwhile, Tesla also cut the Model Y Long Range by $2,000 to $48,490 and the Model Y Performance vehicle trim by $2,000 to $52,490. Tesla also adjusted Model Y prices in Norway, which could signal other price changes in Europe before the end of the year. The EV giant has been offering substantial discounts on inventory vehicles in the U.S. and Europe.
The Model Y Long Range starting price in the U.S. is now around 25% lower than its $65,990 price in December 2022.
The latest price cuts follow Tesla slashing production in the third quarter, ostensibly for plant upgrades but likely also to try to clear inventories and limit the need for further price cuts.
Tesla stock pared early losses, gaining 0.2% to 260.57 Friday during market action. On the week, TSLA advanced 4.1% despite missing third-quarter delivery estimates Monday. Tesla bulls appear to be betting on a fourth-quarter rebound in deliveries with the revamped Model 3 in China and the expected Cybertruck delivery launch.
Late Monday, Tesla announced its newly launched U.S. Model Y variant is now available in the U.S.
The EV company's starting price for the rear-wheel drive Model Y is $43,990, with an official range of 260 miles, according to Tesla's website. The prior base Model Y, which is no longer available, started at $47,740.
Thursday's latest official price cuts reflect continued Tesla demand concerns and pressure on profit margins. Many analysts as recently as last month expected the bulk of the Tesla price cuts were in the rearview mirror.
"The price cut last night was clearly a bit of a surprise," Wedbush analyst Dan Ives, a longtime Tesla bull, wrote on X, formerly Twitter, Friday. "It's all about when does stabilization hit on prices."
"Volumes for 4Q key," he added.
Tesla Stock Performance
Last week, Tesla stock rose 2.2% to 250.22. On Monday, shares closed just above the 50-day line, before surging around 6% Wednesday.
Tesla stock currently resides in a cup-with-handle base, with a 278.98 buy point, according to MarketSmith.
Wednesday's move above the 50-day line offered an early entry into TSLA stock. Shares closed Thursday around a short trendline within the handle, offering another buying opportunity.
Analysts also maintain that the United Auto Workers strike against Ford (F), General Motors (GM) and Stellantis (STLA) is good news for Tesla, a nonunion shop.
Tesla stock ranks fourth in the 35-stock IBD Automaker industry group. The S&P 500 component has a 96 Composite Rating out of a best-possible 99. The Cathie Wood-backed stock has an 96 Relative Strength Rating and itsEPS Rating is 93.
Please follow Kit Norton on X, formerly known as Twitter, @KitNorton for more coverage.
YOU MAY ALSO LIKE:
Get An Edge In The Stock Market With IBD Digital
Labor Unions Keep The Heat On Starbucks And Amazon
Learning How To Pick Great Stocks? Read Investor's Corner
After Bullish Reversal, Here's What To Do; Nvidia Leads 11 New Buys
